Sage Advice For Safeguarding Businesses Intangible Assets…

I, and colleagues experienced in safeguarding businesses proprietary intangible assets…from compromise, misappropriation, and economic espionage, etc., recognize key challenges to achieve timely detection of materializing risks and quantifying losses in actual ‘dollar contexts’.

In part, methods a victim (company, organization, institution) may elect to…use to quantify a loss, should it become known, frequently pivot on one or more of the following inclinations and/or factors, e.g.,

• ethnicity (country of origin) of the alleged perpetrator(s).
• the perpetrators’ (insiders) position and level of trust.
• victims’ perspective regarding the potential for experiencing reputation risk as a consequence relative to…
  • the nature-type of proprietary assets compromised.
  • if the data/information loss identified customers/clients personal information, and if
  • there is a legislative mandate to report any-all compromises, and
  • whether a victim company elects to (voluntarily) assign a dollar value to (quantify) their asset loss-compromise, and if so,
    • what methodology was used to arrive at the dollar value, i.e., where, what, and how data was collected and ultimately quantified?

• the relative importance of the compromised intangible assets, i.e., their contributory role and value to R&D, a current project, potential breakthrough, and/or a contractual obligation.
• the type of intangible assets compromised, i.e., proprietary and/or competitive advantage contributors – drivers to intellectual, structural, and/or relationship capital.
• how and when the compromise-loss was detected-discovered.
• are there immediate and/or strategic adverse consequences to a company’s value chain, investors, stakeholders, and brand, etc.
• the perceived – proven motive(s) of the perpetrator(s) of the compromise.
• if there are other-additional ‘end users’ (recipients) of the compromised assets, and are they economic, competitive advantage, or national security adversaries?

My counsel to business leadership is ‘avoid discounting any of the above too quickly’…it’s fair to suggest in today’s global, aggressively predatorial, and ‘winner take all’ business transaction environments…

• that a strong and increasingly pervasive notion of ‘risk’ exist today that influence victim companies to characterize intangible asset losses in worst case scenario contexts, based variously on the factors, sentiments, and inclinations cited above.

In this context, there are numerous business operating realities I am consistently conscious…with respect to characterizing proprietary  intangible asset compromises and losses of U.S. businesses…

• in most circumstances, unless mandated to do otherwise, it is often rationalized that it is seldom in the interest of business leadership and the sustainability of future transactions and supply chains…
• particularly globally operating companies which strive to sustain amicable trading – transaction relationships, to be overly ‘public’ about ‘going public’ about asset compromises coupled with dollar value loss estimates.

Readers inclined to explore this phenomena further…would find it very useful insights about these issues authored by Drs. Julie Ryan and Theresa Jefferson (George Washington University) aptly titled ‘The Use, Misuse, and Abuse of Statistics in Information and Security Research’.

In this paper, the authors analyzed multiple, well known surveys that tout information asset security trends and losses. They make, in my judgment, a convincing argument that the…

• findings are frequently anecdotal, not generalizable to leadership levels, and are often reported in a cumulative form. 
• collectively, this suggests most findings may be unreliable for use by business leadership to justify the allocation or re-allocation of intangible asset safeguard resources.

NOTE: A special thanks to Dr. Julie Ryan (George Washington University) co-author to ‘The Use, Misuse, and Abuse of Statistics in Information and Security Research’ whom I met with on two occasions and came to be the inspiration for this post.

Michael D. Moberly m.moberly@kpstrat.com St. Louis (originally posted) September 6, 2012  the ‘Business Intangible Asset Blog’ since May 2006, 650+ posts, ‘where intangible assets, business, and effective solutions converge’.

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